9 unchanged sentences
Liquidity and Capital Resources
+Added: Tab le of Contents
The following discussion may contain forward-looking statements that reflect our plans, estimates and beliefs.
25 unchanged sentences
• “Results of Operations” begins with a discussion of our AAR, including a summary of the changes made to the key assumptions in 2025 and 2024, as well as the resulting impact on net income (loss) available to shareholders in each period.
+Added: Tab le of Contents
Our Results of Operations discussion and analysis presents a review for the years ended December 31, 2025 and 2024 and year-over-year comparisons between these years.
6 unchanged sentences
See “Business — Segment Information” and Note 2 of the Notes to the Consolidated Financial Statements for further information regarding our segments.
+Added: On November 6, 2025, BHF entered into the Merger Agreement, pursuant to which, at the closing of the transactions contemplated by the Merger Agreement, Merger Sub will merge with and into BHF, and the separate corporate existence of Merger Sub will cease, with BHF continuing as the surviving corporation and as a wholly-owned subsidiary of Aquarian Parent.
+Added: The Merger Agreement was adopted by stockholders at the special meeting held on February 12, 2026, and the applicable waiting period under the Hart-Scott Rodino Antitrust Improvement Act of 1976, as amended, has expired.
+Added: The Merger is expected to close in 2026.
+Added: However, the completion of the Merger remains subject to the satisfaction or waiver of certain other customary conditions, including receipt of insurance regulatory approvals.
+Added: See “Risks Related to the Merger – The completion of the Merger is subject to a number of conditions, many of which are largely outside the parties’ control, and, if these conditions are not satisfied or waived, the Merger may not be completed within the expected timeframe or at all.”
Net income (loss) available to shareholders and adjusted earnings (loss), a non-GAAP financial measure, were as follows:
9 unchanged sentences
(1) We use the term “net income (loss) available to shareholders” to refer to “net income (loss) available to Brighthouse Financial, Inc.’s common shareholders” and “adjusted loss” to refer to negative adjusted earnings values throughout the results of operations discussions.
−Removed: For the year ended December 31, 2024, we had net income available to shareholders of $286 million and adjusted earnings of $1.3 billion compared to net loss available to shareholders of $1.2 billion and adjusted earnings of $969 million for the year ended December 31, 2023.
−Removed: Net income available to shareholders for the year ended December 31, 2024 primarily reflects favorable pre-tax adjusted earnings, net of an unfavorable impact due to a reinsurance premium rate increase retroactive to September 2019, which resulted from the conclusion of a reinsurance arbitration, and the related impacts.
−Removed: Favorable pre-tax adjusted earnings was partially offset by an unfavorable change in the estimated fair value of freestanding interest rate derivatives we use to hedge our ULSG business resulting from increasing long-term interest rates, net unfavorable changes in the estimated fair value of our variable annuity guaranteed benefit riders due to market factors, net investment losses on sales of fixed maturity securities, and net investment losses on mortgage loans.
+Added: For the year ended December 31, 2025, we had net income available to shareholders of $331 million and adjusted earnings of $1.6 billion compared to net income available to shareholders of $286 million and adjusted earnings of $1.3 billion for the year ended December 31, 2024.
+Added: Net income available to shareholders for the year ended December 31, 2025 primarily reflects favorable pre-tax adjusted earnings and a net investment gain on the sale of a subsidiary which owned certain mineral rights across the U.S.
+Added: These favorable impacts were partially offset by unfavorable changes in our Shield embedded derivatives net of our variable annuity and Shield hedges due to market factors, an unfavorable change in the estimated fair value of freestanding interest rate derivatives we use to hedge our ULSG business, net investment losses on sales of fixed maturity securities, net investment losses on mortgage loans and the weakening of the U.S.
+Added: dollar unfavorably impacting foreign currency forwards and swaps.
See “— Non-GAAP Financial Disclosures.” See “— Results of Operations” for a detailed discussion of our results.
+Added: Tab le of Contents
Risk Management Strategies
We employ risk management strategies to mitigate the effects of severe market disruptions and other economic events on our business.
−Removed: These strategies currently include macro hedge programs that manage market risks across all products, hedging certain market risk exposures at the product level, and, to a lesser extent, reinsurance.
+Added: These strategies currently include hedging certain market risk exposures at the product level while taking into consideration market risk exposures at an aggregated level, as well as reinsurance.
Our risk management strategies focus on protecting the capital and surplus of our insurance subsidiaries, through the use of metrics aligned with regulatory capital requirements.
−Removed: We continually review our risk management strategies in the context of our overall capitalization targets as well as monitor the capital markets for opportunities to adjust our derivative positions to manage our market risk exposure, as appropriate.
+Added: We continually review our risk management strategies in the context of our overall capitalization targets and monitor the capital markets for opportunities to adjust our derivative positions to manage our market risk exposure, as appropriate.
A metric we utilize to manage our risk is the combined RBC ratio (“Combined RBC Ratio”), which reflects the aggregate RBC ratio of our insurance subsidiaries, defined as aggregate TAC of our insurance subsidiaries divided by the total of their respective company action level RBCs.
2 unchanged sentences
Brighthouse Financial targets a Combined RBC Ratio of 400% to 450% in normal market conditions.
−Removed: We manage our variable annuity and first generation Shield Annuity contracts together, consistent with how we determine statutory reserves and required capital.
−Removed: These products have natural risk offsets because our obligations under Shield Annuity contracts decrease in falling equity markets when variable annuity guarantee obligations increase, and our obligations under Shield Annuity contracts increase in rising equity markets when variable annuity guarantee obligations decrease.
−Removed: In managing the risks associated with this block, we continue to operate with a first loss position of no more than $500 million.
−Removed: The first loss position is relative to our target funding level, which is based on regulatory capital requirements.
−Removed: We launched updated versions of our Shield Annuity products in 2024, which we manage and hedge on a standalone basis separately from our variable annuity and first generation Shield Annuity products.
+Added: We have historically managed the risks related to our variable annuity and first generation Shield Annuity contracts on a combined basis.
+Added: However, in the third quarter of 2025, we completed an initiative that established a standalone hedging program for each product allowing us to more effectively manage the risks related to these two products.
+Added: We launched updated versions of our Shield Annuity products in 2024, which we also manage and hedge on a standalone basis separately from our variable annuity and first generation Shield Annuity products.
We believe the level of our capital protection provides us financial flexibility and supports deploying capital for growing long-term, sustainable shareholder value.
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Historically, we have managed interest rate exposure in aggregate across the Company, while also setting individual hedge targets for certain products such as ULSG, where the economics of the interest rate derivatives are ceded through reinsurance to BRCD.
−Removed: Our current macro hedge program is used to manage interest rate risk in aggregate, with rebalancing and trade executions determined by net exposure.
−Removed: By managing the interest rate exposure on a net basis, we expect to more efficiently manage the derivative portfolio, protect capital and reduce costs.
+Added: As discussed above, in the third quarter of 2025, we established a standalone hedging program for our variable annuity block.
+Added: Our current variable annuity interest rate hedging program is intended to mitigate our exposure to changes in interest rates arising from the variable annuity contracts.
Our interest rate hedge programs may also include hybrid options that have other risk exposure in addition to interest rate exposure.
+Added: We continue to set individual hedge targets for certain products such as ULSG, where the economics of the interest rate derivatives are ceded through reinsurance to BRCD.
+Added: While we now manage interest rate risk primarily on a product basis, we also manage interest rate exposure in aggregate across the Company.
The ULSG block, which is no longer actively sold, includes the business retained by our insurance subsidiaries and the portion of it that is ceded to BRCD for providing redundant, non-economic reinsurance financing support.
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The net statutory reserves for the ULSG business in our insurance subsidiaries and BRCD (which is in part supported by reinsurance financings) were $24.4 billion and $24.6 billion for the years ended December 31, 2025 and 2024, respectively.
+Added: Tab le of Contents
Our ULSG Target is sensitive to the actual and future expected level of long-term U.S.
2 unchanged sentences
Likewise, if interest rates rise, our ULSG Target declines.
−Removed: The interest rate derivatives allocated to ULSG Assets prioritize the ULSG Target.
+Added: The interest rate derivatives included in ULSG Assets seek to offset movement in the ULSG Target.
This could increase the period-to-period volatility of net income and equity due to differences in the sensitivity of the ULSG Target and GAAP liabilities to the changes in interest rates.
4 unchanged sentences
We are exposed to equity market risk from policyholder liabilities with long-term guarantees based on equity performance, with our most significant exposures found in crediting rates on Shield Annuities and variable annuity guarantees.
−Removed: We manage equity risk primarily through the use of product-specific hedging strategies and have a macro hedging program for managing residual equity risk.
−Removed: As discussed above, we have historically managed equity risk of variable annuities and Shield Annuities together, recognizing the natural risk offset between the two products.
−Removed: In 2024, we launched updated versions of our Shield Annuity products, which we manage on a standalone basis separately from our variable annuity and first generation Shield Annuity products.
−Removed: As we write new business, we use equity derivatives that are intended to offset the embedded options related to the crediting rate in Shield Annuity contracts.
+Added: While we manage equity risk primarily through the use of product-specific hedging strategies, we also manage equity risk in aggregate across the Company.
+Added: As discussed above, we have historically managed equity risk of variable annuities and first generation Shield Annuity contracts together, but in the third quarter of 2025, we established standalone equity hedging programs for each product.
+Added: We also manage the risks associated with our updated Shield Annuity product, launched in 2024, on a standalone basis.
+Added: We hedge the equity risk associated with Shield Annuity products by purchasing equity derivatives that are intended to offset the index credits due to contract holders.
Since it is not practical to hedge each policy individually, we may group individual policies into cohorts or use other industry methods to reduce the number of hedge trades.
+Added: We manage the equity risk associated with our variable annuity contracts through the use of derivatives intended to offset the exposure attributable to changes in equity markets.
Industry Trends and Uncertainties
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Equity market performance can affect our profitability for variable annuities, Shield Annuities and other separate account products as a result of the effects it has on product demand, revenues, expenses, reserves and our risk management effectiveness.
−Removed: In September, November and December 2024, the Federal Reserve Board (the “Federal Reserve”) decreased the target range for the federal funds rate, and any additional future decrease may negatively impact our business in certain respects, including our investment portfolio, by lowering the level of long-term interest rates and changing the shape of the yield curve.
+Added: The Federal Reserve Board (the “Federal Reserve”) decreased the target range for the federal funds rate in September, October and December 2025, as well as in September, November and December 2024, and any additional future decrease may negatively impact our business in certain respects, including our investment portfolio, by lowering the level of long-term interest rates and changing the shape of the yield curve.
The level of long-term interest rates and the shape of the yield curve can have a negative effect on the profitability for variable annuities, as well as the demand for, and the profitability of, spread-based products such as fixed annuities, index-linked annuities and universal life insurance.
6 unchanged sentences
Prolonged and elevated inflation could adversely affect the financial markets and the economy generally and dispelling it may require governments to pursue restrictive fiscal and monetary policies, which could constrain overall economic activity and inhibit revenue growth.
−Removed: Events involving limited liquidity, defaults, nonperformance or other adverse developments that affect financial institutions or the financial services industry generally, or concerns or rumors about events of these kinds or other similar risks, could adversely affect market-wide liquidity, which could increase the risk of a recession or an equity market downturn and negatively impact various portions of our business, including our investment portfolio.
+Added: Events involving limited liquidity, defaults, nonperformance, fraud or other adverse developments that affect financial institutions or the financial services industry generally, or concerns or rumors about events of these kinds or other similar risks, could adversely affect market-wide liquidity, which could increase the risk of a recession or an equity market downturn and negatively impact various portions of our business, including our investment portfolio.
See “Risk Factors — Economic Environment and Capital Markets-Related Risks — If difficult conditions in the capital markets and the U.S.
−Removed: economy generally persist or are perceived to persist, they may materially adversely affect our business and results of operations” and “Risk Factors — Risks Related to our Investment Portfolio — Our investment portfolio is subject to significant financial risks both in the U.S.
+Added: economy generally persist or are perceived to persist, they may materially adversely affect our business and results of operations” and
+Added: Tab le of Contents
+Added: “Risk Factors — Risks Related to Our Investment Portfolio — Our investment portfolio is subject to significant financial risks both in the U.S.
and global financial markets, including credit risk, interest rate risk, inflation risk, market valuation risk, liquidity risk, real estate risk, derivatives risk, and other factors outside our control, the occurrence of any of which could have a material adverse effect on our financial condition and results of operations.”
The above factors affect our expectations regarding future margins.
−Removed: We review our long-term assumptions about capital markets returns and interest rates, along with other assumptions such as contract holder behavior, as part of our annual actuarial review.
+Added: We review our long-term assumptions about capital markets returns and interest rates, along with other assumptions such as contract holder behavior, as part of our AAR.
As additional company specific or industry information on contract holder behavior becomes available, related assumptions may change and may potentially have a material impact on liability valuations and net income.
23 unchanged sentences
• measurement of income taxes and the valuation of deferred tax assets.
+Added: Tab le of Contents
In applying our accounting policies, we make subjective and complex judgments that frequently require estimates about matters that are inherently uncertain.
31 unchanged sentences
The attributed fee ratio is not updated in subsequent periods.
+Added: Tab le of Contents
The Company updates the estimated fair value of variable annuity guarantees in subsequent periods by projecting future benefits using capital markets inputs and actuarial assumptions, including expectations of policyholder behavior.
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Capital market inputs used in the measurement of crediting rate embedded derivatives are updated quarterly through net income.
+Added: Tab le of Contents
Market conditions, including interest rates and implied volatilities, and variations in actuarial assumptions and risk margins, as well as changes in our nonperformance risk adjustment, may result in significant fluctuations in the estimated fair value that could have a material impact on net income.
24 unchanged sentences
Adjusted earnings, which may be positive or negative, focuses on our primary businesses by excluding the impact of market volatility, which could distort trends.
+Added: Adjusted earnings was updated during the first quarter of 2025 in connection with the establishment of a trading portfolio comprised of certain fixed income securities (classified as “trading securities” under GAAP).
+Added: The Company did not have trading securities prior to the first quarter of 2025.
The following items are excluded from total revenues in calculating adjusted earnings:
• Net investment gains (losses);
+Added: • Investment gains (losses) on trading securities measured at estimated fair value through net investment income;
• Net derivative gains (losses), excluding earned income and amortization of premium on derivatives that are hedges of investments or that are used to replicate certain investments, but do not qualify for hedge accounting treatment (“Investment Hedge Adjustments”).
+Added: Tab le of Contents
The following items are excluded from total expenses in calculating adjusted earnings:
• Change in MRBs;
−Removed: • Change in fair value of the crediting rate on experience-rated contracts (“Market Value Adjustments”).
+Added: • Change in fair value of the crediting rate on experience-rated contracts and market value adjustments on institutional group annuities that are economically offset by gains (losses) on the related trading securities (“Market Value Adjustments”).
The provision for income tax related to adjusted earnings is calculated using the statutory tax rate of 21%, net of impacts related to the dividends received deduction, tax credits and current period non-recurring items.
1 unchanged sentence
The following table illustrates how each component of adjusted earnings is calculated from the GAAP statements of operations line items:
−Removed: Component of Adjusted Earnings How Derived from GAAP (1)
−Removed: (i) Fee income (i) Universal life and investment-type product policy fees plus Other revenues .
−Removed: (ii) Net investment spread (ii) Net investment income plus Investment Hedge Adjustments reduced by Interest credited to policyholder account balances (excluding Market Value Adjustments) and interest on future policy benefits.
−Removed: (iii) Insurance-related activities (iii) Premiums less Policyholder benefits and claims , excluding interest on future policy benefits.
−Removed: (iv) Amortization of DAC and VOBA (iv) Amortization of deferred policy acquisition costs (“DAC”) and value of business acquired (“VOBA”) .
−Removed: (v) Other expenses (v) Other expenses.
−Removed: (vi) Provision for income tax expense (benefit) (vi) Tax impact of the above items, calculated using the statutory tax rate of 21%, net of impacts related to the dividends received deduction, tax credits and current period non-recurring items.
+Added: Component of Adjusted Earnings
+Added: How Derived from GAAP (1)
+Added: Fee income (i) Universal life and investment-type product policy fees plus Other revenues .
+Added: Net investment spread (ii) Net investment income (excluding investment gains (losses) on trading securities) plus Investment Hedge Adjustments reduced by Interest credited to policyholder account balances (excluding Market Value Adjustments) and interest on future policy benefits.
+Added: Insurance-related activities (iii) Premiums less Policyholder benefits and claims , excluding interest on future policy benefits.
+Added: Amortization of DAC and VOBA (iv) Amortization of deferred policy acquisition costs (“DAC”) and value of business acquired (“VOBA”) .
+Added: Other expenses (v) Other expenses.
+Added: Provision for income tax expense (benefit) (vi) Tax impact of the above items, calculated using the statutory tax rate of 21%, net of impacts related to the dividends received deduction, tax credits and current period non-recurring items.
_______________
4 unchanged sentences
Adjusted net investment income is used by management to measure our performance, and we believe it enhances the understanding of our investment portfolio results.
−Removed: Adjusted net investment income represents GAAP net investment income plus Investment Hedge Adjustments.
+Added: Adjusted net investment income represents GAAP net investment income plus Investment Hedge Adjustments less investment gains (losses) on trading securities.
For a reconciliation of adjusted net investment income to net investment income, the most directly comparable GAAP measure, see table note (3) to the summary yield table located in “— Investments — Current Environment — Investment Portfolio Results.”
6 unchanged sentences
For a reconciliation of adjusted net investment income yield to net investment income, the most directly comparable GAAP measure, see the summary yield table located in “— Investments — Current Environment — Investment Portfolio Results.”
+Added: Tab le of Contents
Results of Operations
6 unchanged sentences
Annuity Guaranteed Benefits and Shield Annuity Liabilities for the Years Ended December 31, 2025 and 2024
+Added: Tab le of Contents
Annual Actuarial Review
−Removed: We typically conduct our AAR in the third quarter of each year.
−Removed: As part of the 2024 AAR, for our ULSG business, we increased the long-term general account earned rate, driven by an increase in the mean reversion rate, from 3.75% to 4.00%.
−Removed: Also, with respect to our ULSG business, we updated assumptions regarding policyholder behavior, including mortality, premium persistency, lapses and withdrawals.
−Removed: For our variable annuity business, we updated our annuitization, mortality, lapses and withdrawals, as well as separate account assumptions, including fund fees and allocations.
+Added: We conducted our GAAP AAR in the third quarter of 2025.
+Added: As part of the 2025 GAAP AAR, for our ULSG business, we updated assumptions regarding policyholder behavior, including mortality, premium persistency, lapses and withdrawals.
+Added: In addition, we increased the long-term general account earned rate, driven by an increase in the mean reversion rate, from 4.00% to 4.50%.
+Added: For our variable annuity business, we updated assumptions regarding annuitization, mortality, guaranteed principal option utilization, lapses and withdrawals, as well as separate account assumptions, including fund fees and allocations.
+Added: For the payout annuity business, we updated assumptions regarding mortality.
For term participating and non-participating whole life insurance, we updated assumptions regarding mortality and lapses.
−Removed: As part of the 2023 AAR, for our ULSG business, we increased the long-term general account earned rate, driven by an increase in the mean reversion rate, from 3.50% to 3.75%.
−Removed: Also, with respect to our ULSG business, we updated assumptions regarding policyholder behavior, including mortality, premium persistency, lapses, withdrawals and maintenance expenses.
−Removed: For our variable annuity business, we updated our annuitization, mortality, lapses and withdrawals, as well as separate account assumptions, including fund fees, allocations and volatility.
+Added: As part of the 2024 GAAP AAR, for our ULSG business, we increased the long-term general account earned rate, driven by an increase in the mean reversion rate, from 3.75% to 4.00%.
+Added: Also, with respect to our ULSG business, we updated assumptions regarding policyholder behavior, including mortality, premium persistency, lapses and withdrawals.
+Added: For our variable annuity business, we updated assumptions regarding annuitization, mortality, lapses and withdrawals, as well as separate account assumptions, including fund fees and allocations.
For term participating and non-participating whole life insurance, we updated assumptions regarding mortality and lapses.
+Added: We conducted our 2025 statutory AAR in the fourth quarter, the results of which will be included in our insurance subsidiaries’ 2025 annual statutory financial statements.
+Added: The 2025 statutory AAR resulted in an increase to our statutory reserves;
+Added: however, our 2025 preliminary Combined RBC Ratio was 456%, above our target range of 400% to 450% in normal market conditions, without contributing capital to our insurance subsidiaries.
+Added: See “Risk Factors — Risks Related to Our Business — Differences between actual experience and actuarial assumptions may adversely affect our financial results, capitalization and financial condition.”
The impact on income (loss) available to shareholders before provision for income tax was as follows:
7 unchanged sentences
Life business
−Removed: Run-off 359 119
Total included in pre-tax adjusted earnings (loss)
Total impact on income (loss) available to shareholders before provision for income tax
+Added: Tab le of Contents
Consolidated Results for the Years Ended December 31, 2025 and 2024
7 unchanged sentences
Net derivative gains (losses)
−Removed: (3,668) (3,907)
Total revenues
13 unchanged sentences
Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders
−Removed: $ 286 $ (1,214)
The components of net income (loss) available to shareholders were as follows:
3 unchanged sentences
Net investment gains (losses)
+Added: Investment gains (losses) on trading securities
Net derivative gains (losses), excluding investment hedge adjustments
8 unchanged sentences
Includes gains and losses on sales of investments, impairments losses and changes in allowances for credit losses.
+Added: Tab le of Contents
+Added: Investment Gains (Losses) on Trading Securities.
+Added: Includes gains and losses on trading securities measured at estimated fair value through net investment income.
Net Derivative Gains (Losses), Excluding Investment Hedge Adjustments.
3 unchanged sentences
Market Value Adjustments.
−Removed: Includes the change in fair value of the crediting rate on experience-rated contracts.
+Added: Includes the change in fair value of the crediting rate on experience-rated contracts and market value adjustments on institutional group annuities that are economically offset by gains (losses) on the related trading securities.
Pre-tax Adjusted Earnings.
2 unchanged sentences
Year Ended December 31, 2025 Compared with the Year Ended December 31, 2024
−Removed: Income available to shareholders before provision for income tax was $315 million ($286 million, net of income tax), an increase of $1.9 billion ($1.5 billion, net of income tax) from loss available to shareholders before provision for income tax of $1.6 billion ($1.2 billion, net of income tax) in the prior period.
+Added: Income available to shareholders before provision for income tax was $367 million ($331 million, net of income tax), an increase of $52 million ($45 million, net of income tax) from income available to shareholders before provision for income tax of $315 million ($286 million, net of income tax) in the prior period.
The increase in income before provision for income tax was driven by the following favorable items:
−Removed: • lower losses from variable annuity guaranteed benefit riders, see “— Annuity Guaranteed Benefits and Shield Annuity Liabilities for the Years Ended December 31, 2024 and 2023”;
• higher pre-tax adjusted earnings, as discussed in greater detail below;
−Removed: The increase in income before provision for income tax was partially offset by the unfavorable impact of long-term interest rates on interest rate derivatives used to manage interest rate exposure in our ULSG business, as the long-term interest rate increased more in the current period resulting in a loss of $557 million and increased less in the prior period resulting in a loss of $197 million.
+Added: • lower losses from the impact of interest rates on derivatives used to manage interest rate exposure in our ULSG business, as long-term rates were relatively flat in the current period and increased in the prior period;
+Added: • net investment gains (losses) reflecting lower net losses on sales of fixed maturity securities, a net decrease in impairments on fixed maturity securities, and a gain on the sale of a subsidiary which owned certain mineral rights across the U.S., partially offset by higher losses on mortgage loans due to an increase in the allowance for credit losses.
+Added: The increase in income before provision for income tax was partially offset by the following unfavorable items:
+Added: • higher losses from variable annuity guaranteed benefit riders, see “— Annuity Guaranteed Benefits and Shield Annuity Liabilities for the Years Ended December 31, 2025 and 2024”;
+Added: dollar weakening in the current period and strengthening in the prior period, unfavorably impacting foreign currency forwards and swaps.
The provision for income tax, calculated as a percentage of income (loss) before provision for income tax, resulted in an effective tax rate of 8% in the current period compared to 7% in the prior period.
Our effective tax rate differs from the statutory tax rate primarily due to the impacts of the dividends received deduction, tax credits and current period non-recurring items.
+Added: Tab le of Contents
Reconciliation of Net Income (Loss) Available to Shareholders to Adjusted Earnings (Loss)
1 unchanged sentence
Year Ended December 31, 2025
−Removed: Annuities Life Run-off Corporate & Other Total
+Added: Corporate & Other
(In millions)
3 unchanged sentences
Net investment gains (losses)
+Added: Investment gains (losses) on trading securities
Net derivative gains (losses), excluding investment hedge adjustments of $0
−Removed: (3,187) 17 (529) — (3,699)
Change in market risk benefits
1 unchanged sentence
Pre-tax adjusted earnings (loss), less net income (loss) attributable to noncontrolling interests and preferred stock dividends
−Removed: 1,548 38 81 (44) 1,623
Provision for income tax expense (benefit)
Adjusted earnings (loss)
−Removed: $ 1,251 $ 33 $ 65 $ (30) $ 1,319
Year Ended December 31, 2024
−Removed: Annuities Life Run-off Corporate & Other Total
+Added: Corporate & Other
(In millions)
3 unchanged sentences
Net investment gains (losses)
+Added: Investment gains (losses) on trading securities
Net derivative gains (losses), excluding investment hedge adjustments of $31
−Removed: (3,765) (2) (205) (40) (4,012)
Change in market risk benefits
1 unchanged sentence
Pre-tax adjusted earnings (loss), less net income (loss) attributable to noncontrolling interests and preferred stock dividends
−Removed: 1,437 (69) (100) (86) 1,182
Provision for income tax expense (benefit)
Adjusted earnings (loss)
−Removed: $ 1,169 $ (53) $ (77) $ (70) $ 969
+Added: Tab le of Contents
Consolidated Results for the Years Ended December 31, 2025 and 2024 - Adjusted Earnings (Loss)
−Removed: The components of adjusted earnings were as follows:
+Added: The components of adjusted earnings (loss) were as follows:
Years Ended December 31,
(In millions)
−Removed: Fee income $ 2,695 $ 2,778
Net investment spread
6 unchanged sentences
Adjusted earnings (loss)
−Removed: $ 1,319 $ 969
Year Ended December 31, 2025 Compared with the Year Ended December 31, 2024
2 unchanged sentences
• lower net costs associated with insurance-related activities due to:
−Removed: ◦ a net decrease in liability balances resulting from year-over-year changes made in connection with the AAR in our Run-off and Annuities segments and other refinements;
+Added: ◦ a net decrease in liability balances resulting from year-over-year changes made in connection with the AAR in our Run-off and Life segments and other refinements;
+Added: ◦ a decrease in liability balances in our Run-off segment resulting from a reinsurance premium rate increase associated with the conclusion of a reinsurance arbitration in the prior period;
partially offset by
−Removed: ◦ an increase in liability balances in our Run-off segment resulting from a reinsurance premium rate increase associated with the conclusion of a reinsurance arbitration;
−Removed: ◦ a decrease in income annuity underwriting margins;
−Removed: • higher net investment spread due to:
−Removed: ◦ higher average invested assets resulting from positive net flows in the general account;
−Removed: ◦ higher returns on other limited partnerships;
−Removed: ◦ higher investment yields on our fixed income portfolio, as proceeds from maturing investments and the growth in the investment portfolio were invested at higher yields than the portfolio average;
+Added: ◦ higher claims, net of reinsurance, in our Life and Run-off segments;
+Added: ◦ an increase in liability balances in our Run-off segment resulting from a premium rate increase on an existing reinsurance agreement;
+Added: • higher net fee income due to:
+Added: ◦ lower ceded COI fees in our Life and Run-off segments related to the conclusion of the aforementioned reinsurance arbitration in the prior period;
partially offset by
−Removed: ◦ higher interest credited to policyholders due to higher account balances and current and prior period actuarial modeling improvements, net of changes made in the current period in connection with the AAR in our Annuities segment;
−Removed: • lower other expenses due to:
−Removed: ◦ lower operational expenses;
−Removed: ◦ lower legal reserves;
−Removed: ◦ lower transition services agreement expenses;
+Added: ◦ lower asset-based fees resulting from lower average separate account balances, a portion of which is offset in other expenses;
+Added: ◦ a decline in the net COI fees driven by the aging in-force business in our Run-off segment.
+Added: Key net unfavorable impacts were:
+Added: • lower net investment spread due to:
+Added: ◦ higher interest credited to policyholders due to higher account balances and prior period changes made in connection with the AAR, net of year-over-year actuarial modeling improvements in our Annuities segment;
+Added: ◦ lower yields and average invested long-term assets on our institutional spread margin business;
+Added: ◦ lower returns on other limited partnerships;
+Added: ◦ lower returns on short-term investments;
partially offset by
−Removed: ◦ higher asset-based variable annuity expenses resulting from higher average separate account balances, a portion of which is offset in fee income;
−Removed: ◦ higher variable compensation expenses.
−Removed: Key net unfavorable impact was:
−Removed: • lower net fee income due to:
−Removed: ◦ higher ceded cost of insurance fees in our Life and Run-off segments related to the conclusion of the aforementioned reinsurance arbitration, as well as the aging in-force business in our Run-off segment;
+Added: Tab le of Contents
+Added: ◦ higher investment yields on our fixed income portfolio, as proceeds from maturing investments and the growth in the investment portfolio were invested at higher yields than the portfolio average;
+Added: ◦ higher returns on real estate limited partnerships and limited liability companies (“LLC”);
+Added: ◦ higher average invested long-term assets;
+Added: • higher other expenses due to:
+Added: ◦ higher operational expenses;
partially offset by
−Removed: ◦ higher reinsurance fees on our fixed annuity business resulting from higher account balances;
−Removed: ◦ higher asset-based fees resulting from higher average separate account balances, a portion of which is offset in other expenses.
−Removed: The provision for income tax, calculated as a percentage of pre-tax adjusted earnings (loss), resulted in an effective tax rate of 18% in the current period compared to 17% in the prior period.
+Added: ◦ lower asset-based variable annuity expenses resulting from lower average separate account balances, a portion of which is offset in fee income;
+Added: ◦ lower reinsurance expenses in our Life and Run-off segments associated with the conclusion of the aforementioned reinsurance arbitration in the prior period;
+Added: ◦ lower transition services agreement expenses;
+Added: • higher amortization of DAC and VOBA resulting primarily from changes in policyholder behavior in our Annuities segment net of the aging in-force business in our Life segment.
+Added: The provision for income tax, calculated as a percentage of pre-tax adjusted earnings (loss), resulted in an effective tax rate of 18% in both the current period and the prior period.
Our effective tax rate differs from the statutory tax rate primarily due to the impacts of the dividends received deduction, tax credits and current period non-recurring items.
3 unchanged sentences
(In millions)
−Removed: Fee income $ 2,134 $ 1,999
Net investment spread
9 unchanged sentences
Adjusted earnings were $1.3 billion in the current period, an increase of $3 million.
−Removed: Key favorable impact was:
−Removed: • higher fee income due to:
−Removed: ◦ higher reinsurance fees on our fixed annuity business resulting from higher account balances;
−Removed: ◦ higher asset-based fees resulting from higher average separate account balances, a portion of which is offset in other expenses.
−Removed: Key net unfavorable impacts were:
−Removed: • higher net costs associated with insurance-related activities due to:
−Removed: ◦ a decrease in income annuity underwriting margins;
−Removed: ◦ a net increase in liability balances resulting from year-over-year changes made in connection with the AAR;
−Removed: • higher other expenses due to:
−Removed: ◦ higher asset-based variable annuity expenses resulting from higher average separate account balances, a portion of which is offset in fee income;
−Removed: ◦ higher variable compensation expenses;
+Added: Key favorable impacts were:
+Added: • higher net investment spread due to:
+Added: ◦ higher investment yields on our fixed income portfolio, as proceeds from maturing investments and the growth in the investment portfolio were invested at higher yields than the portfolio average;
+Added: ◦ higher returns on real estate limited partnerships and LLCs;
+Added: ◦ higher average invested long-term assets;
partially offset by
−Removed: ◦ lower operational expenses;
+Added: Tab le of Contents
+Added: ◦ higher interest credited to policyholders due to higher account balances and prior period changes made in connection with the AAR, net of year-over-year actuarial modeling improvements;
+Added: • lower other expenses due to:
+Added: ◦ lower asset-based variable annuity expenses resulting from lower average separate account balances, a portion of which is offset in fee income;
◦ lower transition services agreement expenses;
−Removed: • lower net investment spread due to:
−Removed: ◦ higher interest credited to policyholders due to higher account balances and current and prior period actuarial modeling improvements, net of changes made in the current period in connection with the AAR;
partially offset by
−Removed: ◦ higher average invested assets resulting from positive net flows in the general account;
−Removed: ◦ higher investment yields on our fixed income portfolio, as proceeds from maturing investments and the growth in the investment portfolio were invested at higher yields than the portfolio average.
+Added: ◦ higher operational expenses.
+Added: Key net unfavorable impacts were:
+Added: • lower fee income due to lower asset-based fees resulting from lower average separate account balances, a portion of which is offset in other expenses;
+Added: • higher amortization of DAC and VOBA resulting primarily from changes in policyholder behavior.
The provision for income tax, calculated as a percentage of pre-tax adjusted earnings, resulted in an effective tax rate of 19% in both the current period and the prior period.
3 unchanged sentences
(In millions)
−Removed: Fee income $ 189 $ 282
Net investment spread
7 unchanged sentences
Adjusted earnings were $41 million in the current period, an increase of $8 million.
−Removed: Key net favorable impacts were:
−Removed: • lower net costs associated with insurance-related activities due to lower paid claims, net of reinsurance;
−Removed: • higher net investment spread due to:
−Removed: ◦ higher returns on other limited partnerships;
−Removed: partially offset by
+Added: Key favorable impacts were:
+Added: • higher fee income due to lower ceded COI fees related to the conclusion of the aforementioned reinsurance arbitration in the prior period;
+Added: • lower amortization of DAC and VOBA driven by the aging in-force business.
+Added: Key net unfavorable impacts were:
+Added: • lower net investment spread due to:
◦ lower average invested long-term assets;
−Removed: • lower other expenses due to:
−Removed: ◦ lower operational expenses;
−Removed: ◦ lower transition services agreement expenses.
−Removed: The key unfavorable impact was lower fee income due to higher ceded cost of insurance fees related to the conclusion of the aforementioned reinsurance arbitration.
+Added: ◦ lower returns on other limited partnerships;
+Added: • higher net costs associated with insurance-related activities due to:
+Added: ◦ higher claims, net of reinsurance;
+Added: partially offset by
+Added: ◦ a net decrease in liability balances resulting from year-over-year changes made in connection with the AAR and other refinements;
+Added: Tab le of Contents
+Added: • higher other expenses due to:
+Added: ◦ higher operational expenses;
+Added: partially offset by
+Added: ◦ lower reinsurance expenses associated with the conclusion of the aforementioned reinsurance arbitration in the prior period.
The provision for income tax, calculated as a percentage of pre-tax adjusted earnings (loss), resulted in an effective tax rate of 9% in the current period compared to 13% in the prior period.
3 unchanged sentences
(In millions)
−Removed: Fee income $ 360 $ 495
Net investment spread
9 unchanged sentences
• lower net costs associated with insurance-related activities due to:
+Added: ◦ a decrease in liability balances resulting from a reinsurance premium rate increase associated with the conclusion of the aforementioned reinsurance arbitration in the prior period;
◦ a net decrease in liability balances resulting from year-over-year changes made in connection with the AAR and other refinements;
partially offset by
−Removed: ◦ an increase in liability balances resulting from a reinsurance premium rate increase associated with the conclusion of the aforementioned reinsurance arbitration;
−Removed: ◦ higher paid claims, net of reinsurance;
−Removed: • higher net investment spread due to:
−Removed: ◦ higher returns on other limited partnerships;
−Removed: ◦ lower interest credited to policyholders due to lower account balances;
+Added: ◦ an increase in liability balances resulting from a premium rate increase on an existing reinsurance agreement;
+Added: ◦ higher claims, net of reinsurance;
+Added: • lower other expenses due to:
+Added: ◦ lower reinsurance expenses associated with the conclusion of the aforementioned reinsurance arbitration in the prior period;
partially offset by
+Added: ◦ higher operational expenses;
+Added: • higher net fee income due to:
+Added: ◦ lower ceded COI fees related to the conclusion of the aforementioned reinsurance arbitration in the prior period;
+Added: partially offset by
+Added: ◦ a decline in the net COI fees driven by the aging in-force business.
+Added: Tab le of Contents
+Added: The key unfavorable impact was a lower net investment spread due to:
◦ lower average invested long-term assets;
−Removed: The key unfavorable impact was lower fee income due to higher ceded cost of insurance fees related to the conclusion of the aforementioned reinsurance arbitration and the aging in-force business.
−Removed: The provision for income tax, calculated as a percentage of pre-tax adjusted earnings (loss), resulted in an effective tax rate of 20% in the current period compared to 23% in the prior period.
+Added: ◦ lower returns on other limited partnerships.
+Added: The provision for income tax, calculated as a percentage of pre-tax adjusted earnings (loss), resulted in an effective tax rate of 20% in both the current period and the prior period.
Our effective tax rate differs from the statutory tax rate primarily due to the impact of the dividends received deduction.
3 unchanged sentences
(In millions)
−Removed: Fee income $ 12 $ 2
Net investment spread
6 unchanged sentences
Adjusted earnings (loss)
−Removed: $ (30) $ (70)
Year Ended December 31, 2025 Compared with the Year Ended December 31, 2024
−Removed: Adjusted loss was $30 million in the current period, a lower loss of $40 million.
−Removed: Key favorable impacts were:
−Removed: • lower other expenses due to:
−Removed: ◦ lower legal reserves;
−Removed: ◦ lower operational expenses;
−Removed: • higher net investment spread due to higher investment yields and higher average invested long-term assets from funding agreements issued in connection with our institutional spread margin business.
+Added: Adjusted loss was $114 million in the current period, a higher loss of $84 million.
+Added: Key unfavorable impacts were:
+Added: • lower net investment spread due to lower yields and lower average invested long-term assets on our institutional spread margin business;
+Added: • higher other expenses due to higher operational expenses.
The provision for income tax, calculated as a percentage of pre-tax adjusted earnings (loss), resulted in a higher effective tax rate in the current period compared to the prior period.
Our effective tax rate differs from the statutory tax rate primarily due to the impacts of the dividends received deduction and tax credits.
−Removed: We believe the effective tax rate for Corporate & Other is not generally meaningful, neither on a standalone basis nor for comparison to prior periods, since taxes for Corporate & Other are derived from the difference between the overall consolidated effective tax rate and total taxes for the other operating segments.
+Added: We believe the effective tax rate for the Corporate & Other segment is not generally meaningful, neither on a standalone basis nor for comparison to prior periods, since taxes for the Corporate & Other segment are derived from the difference between the overall consolidated effective tax rate and total taxes for the other operating segments.
+Added: Tab le of Contents
Annuity Guaranteed Benefits and Shield Annuity Liabilities for the Years Ended December 31, 2025 and 2024
6 unchanged sentences
Total changes attributable to annuity guaranteed benefits
−Removed: Variable annuity hedges 660 369
+Added: Variable annuity and Shield hedges
Shield embedded derivatives
−Removed: $ (443) $ (2,253)
Market Risk Benefits Mark-to-Market.
8 unchanged sentences
The future fees are included in the estimated fair value of MRB liabilities, with changes recorded in MRBs.
−Removed: Variable Annuity Hedges and Reinsurance.
+Added: Variable Annuity and Shield Hedges, including Reinsurance.
We enter into freestanding derivatives to hedge certain aspects of the annuity guaranteed benefits accounted for as MRBs and index-linked crediting rates accounted for as embedded derivatives.
9 unchanged sentences
Annuity guaranteed benefits and Shield Annuity liabilities performance was unfavorable for the year ended December 31, 2025, primarily driven by:
−Removed: • favorable decreases in annuity guaranteed benefits liabilities due to increasing long-term interest rates and equity markets, as well as changes made in connection with the AAR;
−Removed: • favorable changes in variable annuity hedges due to increasing equity markets, partially offset by increasing long-term interest rates;
−Removed: • unfavorable changes in Shield embedded derivatives due to increasing equity markets, partially offset by increasing long-term interest rates and changes made in connection with the AAR.
+Added: • favorable decreases in annuity guaranteed benefits liabilities due to increasing equity markets, partially offset by changes made in connection with the AAR and decreasing interest rates;
+Added: • favorable changes in variable annuity and Shield hedges due to increasing equity markets;
+Added: • unfavorable changes in Shield embedded derivatives due to increasing equity markets and changes made in connection with the AAR.
+Added: Tab le of Contents
Year Ended December 31, 2024
Annuity guaranteed benefits and Shield Annuity liabilities performance was unfavorable for the year ended December 31, 2024, primarily driven by:
−Removed: • favorable decreases in annuity guaranteed benefits liabilities due to increasing equity markets and long-term interest rates, partially offset by changes made in connection with the AAR;
−Removed: • favorable changes in variable annuity hedges due to increasing equity markets, partially offset by increasing long-term interest rates;
−Removed: • unfavorable changes in Shield embedded derivatives due to increasing equity markets.
+Added: • favorable decreases in annuity guaranteed benefits liabilities due to increasing long-term interest rates and equity markets, as well as changes made in connection with the AAR;
+Added: • favorable changes in variable annuity and Shield hedges due to increasing equity markets, partially offset by increasing long-term interest rates;
+Added: • unfavorable changes in Shield embedded derivatives due to increasing equity markets, partially offset by increasing long-term interest rates and changes made in connection with the AAR.
Investment Risk Management Strategy
12 unchanged sentences
insurance company, we are affected by the monetary policy of the Federal Reserve in the U.S.
−Removed: The Federal Reserve may increase or decrease the federal funds rate in the future, which may have an impact on the pricing levels of risk-bearing investments and may adversely impact the level of product sales.
We are also affected by the monetary policy of central banks around the world due to the diversification of our investment portfolio.
See “— Industry Trends and Uncertainties — Financial and Economic Environment.”
−Removed: In September, November and December 2024, the Federal Reserve decreased the target range for the federal funds rate from between 5.25% and 5.50% to between 4.25% and 4.50% as of December 31, 2024.
−Removed: In 2023, the Federal Reserve increased the target range for the federal funds rate four times — from between 4.25% and 4.50% to between 5.25% and 5.50%.
−Removed: Interest rate increases have contributed to the net unrealized loss position in our investment portfolio.
+Added: In September, October and December 2025, the Federal Reserve decreased the target range for the federal funds rate from between 4.25% and 4.50% to between 3.50% to 3.75%.
+Added: In 2024, the Federal Reserve decreased the target range for the federal funds rate three times — from between 5.25% and 5.50% to between 4.25% and 4.50%.
+Added: The Federal Reserve may increase or decrease the federal funds rate in the future, which may have an impact on the pricing levels of risk-bearing investments and may adversely impact the level of product sales.
+Added: Prior period interest rate increases have contributed to the net unrealized loss position in our investment portfolio.
As a result of increases in interest rates, the unrealized losses on our fixed maturity securities exceeded the unrealized gains as of December 31, 2025.
5 unchanged sentences
and global financial markets, including credit risk, interest rate risk, inflation risk, market valuation risk, liquidity risk, real estate risk, derivatives risk, and other factors outside our control, the occurrence of any of which could have a material adverse effect on our financial condition and results of operations,” and “Risk Factors — Risks Related to Our Investment Portfolio — Ongoing military actions, the continued threat of terrorism, climate change as well as other catastrophic events may adversely affect the value of our investment portfolio and the level of claim losses we incur.”
+Added: Tab le of Contents
There has been a continued market focus on commercial real estate, including office properties, as a result of hybrid work arrangements and the resulting impact on the demand for office space.
11 unchanged sentences
Years Ended December 31,
−Removed: 2024 2023 2022
−Removed: Yield % Amount Yield % Amount Yield % Amount
(Dollars in millions)
10 unchanged sentences
Years Ended December 31,
−Removed: 2024 2023 2022
(In millions)
1 unchanged sentence
Investment hedge adjustments
+Added: Investment gains (losses) on trading securities
Adjusted net investment income — in the above yield table
See “— Results of Operations — Consolidated Results for the Years Ended December 31, 2025 and 2024” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Results of Operations — Consolidated Results for the Years Ended December 31, 2024 and 2023” in our 2024 Annual Report for an analysis of the year-over-year changes in net investment income.
+Added: Tab le of Contents
Fixed Maturity Securities Available-For-Sale
Fixed maturity securities held by type (public or private) were as follows at:
−Removed: December 31, 2024 December 31, 2023
−Removed: Estimated Fair Value % of Total Estimated Fair Value % of Total
+Added: December 31, 2025
+Added: December 31, 2024
+Added: Estimated Fair Value
+Added: Estimated Fair Value
(Dollars in millions)
16 unchanged sentences
The following table presents total fixed maturity securities by nationally statistical rating organizations (“NRSRO”) rating and the applicable NAIC designation from the NAIC published comparison of NRSRO ratings to NAIC designations, except for certain Structured Securities, which are presented using the NAIC methodologies, as well as the percentage, based on estimated fair value that each NAIC designation is comprised of at:
−Removed: December 31, 2024 December 31, 2023
−Removed: NAIC Designation NRSRO Rating Amortized
−Removed: Cost Allowance for Credit Losses Unrealized
−Removed: Gain (Loss) Estimated Fair Value % of
−Removed: Total Amortized
−Removed: Cost Allowance for Credit Losses Unrealized
−Removed: Gain (Loss) Estimated Fair Value % of
+Added: December 31, 2025
+Added: December 31, 2024
+Added: NAIC Designation
+Added: Amortized Cost
+Added: Allowance for Credit Losses
+Added: Unrealized Gain (Loss)
+Added: Estimated Fair Value
+Added: Amortized Cost
+Added: Allowance for Credit Losses
+Added: Unrealized Gain (Loss)
+Added: Estimated Fair Value
(Dollars in millions)
−Removed: 1 Aaa/Aa/A $ 56,661 $ 5 $ (4,680) $ 51,976 64.9 % $ 56,944 $ 5 $ (3,586) $ 53,353 65.8 %
−Removed: 2 Baa 28,446 — (2,640) 25,806 32.3 27,567 — (2,331) 25,236 31.2
Subtotal investment grade
−Removed: 3 Ba 1,879 — (92) 1,787 2.2 1,839 — (122) 1,717 2.1
−Removed: 4 B 383 2 (32) 349 0.4 593 3 (44) 546 0.7
Caa and lower
2 unchanged sentences
Total fixed maturity securities
+Added: Tab le of Contents
The following tables present total fixed maturity securities, based on estimated fair value, by sector classification and by NRSRO rating and the applicable NAIC designations from the NAIC published comparison of NRSRO ratings to NAIC designations, except for certain Structured Securities, which are presented using the NAIC methodologies as described above:
Fixed Maturity Securities — by Sector & Credit Quality Rating
−Removed: NAIC Designation 1 2 3 4 5 6 Total
−Removed: NRSRO Rating Aaa/Aa/A Baa Ba B Caa and
−Removed: Lower In or Near
+Added: NAIC Designation
+Added: Total Estimated Fair Value
+Added: Caa and Lower
+Added: In or Near Default
(In millions)
December 31, 2025
−Removed: corporate $ 17,036 $ 18,415 $ 1,303 $ 291 $ 49 $ 29 $ 37,123
Foreign corporate
−Removed: RMBS 7,254 15 16 — 1 1 7,287
government and agency
−Removed: CMBS 5,985 344 17 6 4 — 6,356
−Removed: ABS 5,776 498 19 11 8 — 6,312
State and political subdivision
2 unchanged sentences
December 31, 2024
−Removed: corporate $ 16,617 $ 17,260 $ 1,293 $ 476 $ 57 $ 52 $ 35,755
Foreign corporate
−Removed: RMBS 7,390 18 12 1 9 — 7,430
government and agency
−Removed: CMBS 6,039 344 24 — 3 — 6,410
−Removed: ABS 5,746 621 17 12 10 — 6,406
State and political subdivision
5 unchanged sentences
and foreign corporate fixed maturity securities holdings by industry were as follows at:
−Removed: December 31, 2024 December 31, 2023
+Added: December 31, 2025
+Added: December 31, 2024
Total Estimated
(Dollars in millions)
−Removed: Industrial $ 15,448 31.6 % $ 14,751 31.1 %
−Removed: Finance 13,279 27.1 12,957 27.3
−Removed: Consumer 11,155 22.8 10,683 22.6
−Removed: Utility 6,405 13.1 6,273 13.2
Communications
−Removed: Total $ 48,953 100.0 % $ 47,420 100.0 %
Structured Securities
We held $20.5 billion and $20.0 billion of Structured Securities, at estimated fair value, at December 31, 2025 and 2024, respectively, as presented in the RMBS, CMBS and ABS sections below.
+Added: Tab le of Contents
Our RMBS holdings are diversified by security type, risk profile and ratings profile, which were as follows at:
−Removed: December 31, 2024 December 31, 2023
−Removed: Fair Value % of
−Removed: Total Net Unrealized
−Removed: Gains (Losses) Estimated
−Removed: Fair Value % of
−Removed: Total Net Unrealized
−Removed: Gains (Losses)
+Added: December 31, 2025
+Added: December 31, 2024
+Added: Estimated Fair Value
+Added: Net Unrealized Gains (Losses)
+Added: Estimated Fair Value
+Added: Net Unrealized Gains (Losses)
(Dollars in millions)
2 unchanged sentences
Pass-through securities
−Removed: Total RMBS $ 7,287 100.0 % $ (829) $ 7,430 100.0 % $ (764)
Risk profile:
−Removed: Agency $ 5,752 78.9 % $ (800) $ 6,152 82.8 % $ (724)
−Removed: Prime 220 3.0 (19) 152 2.0 (16)
−Removed: Alt-A 992 13.6 (11) 756 10.2 (23)
−Removed: Sub-prime 323 4.5 1 370 5.0 (1)
−Removed: Total RMBS $ 7,287 100.0 % $ (829) $ 7,430 100.0 % $ (764)
Ratings profile:
−Removed: $ 892 12.2 % $ 554 7.5 %
Designated NAIC 1
3 unchanged sentences
Our CMBS holdings are diversified by vintage year, which were as follows at:
−Removed: December 31, 2024 December 31, 2023
−Removed: Amortized Cost Estimated
−Removed: Fair Value Amortized Cost Estimated
+Added: December 31, 2025
+Added: December 31, 2024
+Added: Estimated Fair Value
+Added: Cost Estimated Fair Value
(In millions)
−Removed: $ 81 $ 76 $ 89 $ 83
−Removed: 2013 21 19 43 36
−Removed: 2014 143 125 283 256
−Removed: 2015 929 895 949 876
−Removed: 2016 460 442 461 425
−Removed: 2017 689 652 717 655
−Removed: 2018 1,612 1,524 1,633 1,521
−Removed: 2019 912 807 993 869
−Removed: 2020 501 425 538 442
−Removed: 2021 664 635 813 760
−Removed: 419 411 451 436
−Removed: Total $ 6,776 $ 6,356 $ 7,023 $ 6,410
The estimated fair value of CMBS rated Aaa using rating agency ratings was $3.9 billion, or 67.2% of total CMBS, and designated NAIC 1 was $5.6 billion, or 94.8% of total CMBS, at December 31, 2025.
The estimated fair value of CMBS rated Aaa using rating agency ratings was $4.3 billion, or 67.7% of total CMBS, and designated NAIC 1 was $6.0 billion, or 94.2% of total CMBS, at December 31, 2024.
+Added: Tab le of Contents
Our ABS holdings are diversified by both collateral type and issuer.
Our ABS holdings by collateral type and ratings profile were as follows at:
−Removed: December 31, 2024 December 31, 2023
−Removed: Fair Value % of
−Removed: Total Net Unrealized
−Removed: Gains (Losses) Estimated
−Removed: Fair Value % of
−Removed: Total Net Unrealized
−Removed: Gains (Losses)
+Added: December 31, 2025
+Added: December 31, 2024
+Added: Estimated Fair Value
+Added: Net Unrealized Gains (Losses)
+Added: Estimated Fair Value
+Added: Total Net Unrealized Gains (Losses)
(Dollars in millions)
2 unchanged sentences
Automobile loans
−Removed: Student loans
−Removed: 383 6.1 (12) 397 6.2 (22)
Consumer loans
+Added: Student loans
Credit card loans
−Removed: Other loans 1,321 20.9 (36) 1,095 17.1 (50)
−Removed: Total $ 6,312 100.0 % $ (42) $ 6,406 100.0 % $ (108)
Ratings profile:
−Removed: Rated Aaa $ 3,764 59.6 % $ 3,548 55.4 %
Designated NAIC 1
13 unchanged sentences
Information regarding mortgage loans by portfolio segment is summarized as follows at:
−Removed: December 31, 2024 December 31, 2023
−Removed: Amortized Cost % of
−Removed: Total Allowance for Credit Losses % of Amortized Cost Amortized Cost % of
−Removed: Total Allowance for Credit Losses % of Amortized Cost
+Added: December 31, 2025
+Added: December 31, 2024
+Added: Amortized Cost
+Added: Total Allowance for Credit Losses
+Added: % of Amortized Cost
+Added: Amortized Cost
+Added: Total Allowance for Credit Losses
+Added: % of Amortized Cost
(Dollars in millions)
−Removed: Commercial $ 13,330 56.8 % $ 106 0.8 % $ 13,193 58.3 % $ 69 0.5 %
−Removed: Agricultural 4,591 19.6 30 0.7 % 4,445 19.6 19 0.4 %
−Removed: Residential 5,543 23.6 42 0.8 % 5,007 22.1 49 1.0 %
−Removed: Total $ 23,464 100.0 % $ 178 0.8 % $ 22,645 100.0 % $ 137 0.6 %
+Added: Tab le of Contents
Our mortgage loan portfolio is diversified by both geographic region and property type to reduce the risk of concentration.
The percentage of our commercial and agricultural mortgage loan portfolios collateralized by properties located in the U.S.
−Removed: was 98% at both December 31, 2024 and 2023.
+Added: was 99% and 98% at December 31, 2025 and 2024, respectively.
The remainder was collateralized by properties located outside of the U.S.
6 unchanged sentences
At December 31, 2025, the carrying value as a percentage of total residential mortgage loans for the top three states in the U.S.
−Removed: was 39% for California, 10% for Florida and 6% for New York.
+Added: was 37% for California, 10% for Florida and 6% for Texas.
Commercial Mortgage Loans by Geographic Region and Property Type.
1 unchanged sentence
The diversification across geographic regions and property types of commercial mortgage loans was as follows at:
−Removed: December 31, 2024 December 31, 2023
−Removed: Total Amount % of
+Added: December 31, 2025
+Added: December 31, 2024
(Dollars in millions)
1 unchanged sentence
South Atlantic
−Removed: Pacific 2,644 19.8 2,562 19.4
Middle Atlantic
West South Central
−Removed: Mountain 1,114 8.4 1,182 9.0
East North Central
−Removed: New England 726 5.4 735 5.6
−Removed: International 391 2.9 409 3.1
East South Central
West North Central
+Added: International
Multi-region and Other
3 unchanged sentences
Property type:
−Removed: Apartment $ 5,249 39.4 % $ 5,371 40.8 %
−Removed: Office 3,019 22.7 3,185 24.1
−Removed: Industrial 2,498 18.7 2,092 15.9
−Removed: Retail 1,681 12.6 1,747 13.2
−Removed: Hotel 883 6.6 798 6.0
Total recorded investment
8 unchanged sentences
The monitoring process focuses on higher risk loans, which include those that are classified as restructured, delinquent or in foreclosure, as well as loans with higher loan-to-value ratios and lower debt-service coverage ratios.
−Removed: The monitoring process for agricultural mortgage loans is generally similar, with a focus on higher risk loans, such as loans with higher loan-to-value ratios, including reviews on a geographic and sector basis.
+Added: The monitoring process for agricultural mortgage loans is generally similar, with a focus on higher risk loans, such as loans with higher loan-to-value ratios,
+Added: Tab le of Contents
+Added: including reviews on a geographic and sector basis.
Our residential mortgage loans are reviewed on an ongoing basis.
8 unchanged sentences
Generally, the lower the debt-service coverage ratio, the higher the risk of experiencing a credit loss.
−Removed: For our commercial mortgage loans, our average loan-to-value ratio was 69% and 65% at December 31, 2024 and 2023, respectively, and our average debt-service coverage ratio was 2.3x at both December 31, 2024 and 2023.
+Added: For our commercial mortgage loans, our average loan-to-value ratio was 67% and 69% at December 31, 2025 and 2024, respectively, and our average debt-service coverage ratio was 2.2x and 2.3x at December 31, 2025 and 2024, respectively.
The debt-service coverage ratio, as well as the values utilized in calculating the ratio, is updated annually on a rolling basis, with a portion of the portfolio updated each quarter.
6 unchanged sentences
The carrying values of our limited partnerships and LLCs were as follows at:
−Removed: December 31, 2024 December 31, 2023
+Added: December 31, 2025
+Added: December 31, 2024
(In millions)
1 unchanged sentence
Real estate limited partnerships and LLCs (1)
−Removed: Total $ 4,827 $ 4,946
_______________
4 unchanged sentences
The carrying value of our other invested assets by type was as follows at:
−Removed: December 31, 2024 December 31, 2023
−Removed: Total Carrying
+Added: December 31, 2025
+Added: December 31, 2024
+Added: Carrying Value % of
+Added: Total Carrying Value % of
(Dollars in millions)
4 unchanged sentences
Tax credit and renewable energy partnerships
−Removed: Other 13 0.3 11 0.3
−Removed: Total $ 5,250 100.0 % $ 4,409 100.0 %
+Added: Tab le of Contents
Derivative Risks
1 unchanged sentence
We use a variety of strategies to manage these risks, including the use of derivatives.
+Added: We have historically managed the risks related to our variable annuity and first generation Shield Annuity contracts on a combined basis.
+Added: In the third quarter of 2025, we completed an initiative that established a standalone hedging program for each product allowing us to separately manage the risks related to these two products.
See Note 9 of the Notes to the Consolidated Financial Statements for:
2 unchanged sentences
• the effects of derivatives in cash flow, fair value or non-qualifying hedge relationships on the statements of operations for the years ended December 31, 2025, 2024 and 2023.
−Removed: See “Business — Segment Information — Annuities” and “— Risk Management Strategies” for more information about our use of derivatives by major hedging programs, as well as “— Results of Operations — Annual Actuarial Review” and “Risk Factors — Risks Related to our Investment Portfolio — Our investment portfolio is subject to significant financial risks both in the U.S.
+Added: See “— Risk Management Strategies” for more information about our hedging strategies.
+Added: In addition, see “— Results of Operations — Annual Actuarial Review” and “Risk Factors — Risks Related to Our Investment Portfolio — Our investment portfolio is subject to significant financial risks both in the U.S.
and global financial markets, including credit risk, interest rate risk, inflation risk, market valuation risk, liquidity risk, real estate risk, derivatives risk, and other factors outside our control, the occurrence of any of which could have a material adverse effect on our financial condition and results of operations.”
12 unchanged sentences
This policy applies to the recognition of derivatives on the balance sheet and does not affect our legal right of offset.
+Added: Tab le of Contents
Credit Derivatives
The gross notional amount and estimated fair value of credit default swaps were as follows at:
−Removed: December 31, 2024 December 31, 2023
−Removed: Gross Notional Amount Estimated Fair Value Gross Notional Amount Estimated Fair Value
+Added: December 31, 2025
+Added: December 31, 2024
+Added: Gross Notional Amount
+Added: Estimated Fair Value
+Added: Gross Notional Amount
+Added: Estimated Fair Value
(In millions)
−Removed: Written $ 780 $ 19 $ 1,405 $ 27
The maximum amount at risk related to our written credit default swaps is equal to the corresponding gross notional amount.
24 unchanged sentences
A discussion of future policy benefits by segment follows.
+Added: Tab le of Contents
Future policy benefits for the annuities business are comprised mainly of liabilities for life contingent income annuities.
26 unchanged sentences
As a result of acquisitions, we establish additional liabilities known as excess interest reserves for policies with credited rates in excess of market rates as of the applicable acquisition dates.
+Added: Tab le of Contents
Policyholder account balance liabilities in Run-off are comprised of ULSG, certain company-owned life insurance policies and certain funding agreements.
27 unchanged sentences
Assets pledged or otherwise committed include amounts received in connection with securities lending, funding agreements, derivatives and assets held on deposit or in trust.
+Added: Tab le of Contents
Liquidity refers to our ability to generate adequate cash flows from our normal operations to meet the cash requirements of our operating, investing and financing activities.
8 unchanged sentences
We manage our capital position to maintain our financial strength and credit ratings.
−Removed: Our capital position is supported by our ability to generate cash flows within our insurance subsidiaries, our ability to effectively manage the risks of our businesses and our expected ability to borrow funds and raise additional capital to meet operating and growth needs under a variety of market and economic conditions.
+Added: We target a Combined RBC Ratio of 400% to 450% in normal market conditions.
+Added: We believe a ratio at this level in normal markets provides us with sufficient capital to absorb risks associated with stressed market scenarios.
+Added: In addition, our capital position is supported by our ability to generate cash flows within our insurance subsidiaries, our ability to effectively manage the risks of our businesses and our expected ability to borrow funds and raise additional capital to meet operating and growth needs under a variety of market and economic conditions.
We monitor our debt-to-capital ratio using an average of our key leverage ratios as calculated by A.M.
2 unchanged sentences
There can be no assurance that we will be able to complete any such financing transactions on terms and conditions favorable to us or at all.
−Removed: In support of our target Combined RBC Ratio of 400% to 450% in normal market conditions, we expect to continue to maintain a capital and risk management strategy that targets total assets supporting our variable annuity and Shield Annuity contracts at or above the CTE98 level in normal market conditions.
−Removed: See “Glossary” for the definition of CTE.
−Removed: With our risk management focus on the core drivers of our Combined RBC Ratio, we believe we can better manage our RBC in stressed market scenarios.
−Removed: On November 16, 2023, we authorized the repurchase of up to $750 million of our common stock, which was in addition to our prior $1.2 billion total repurchases authorized in 2021.
−Removed: Repurchases under the latest authorization, of which $543 million was remaining at December 31, 2024, may be made through open market purchases, including pursuant to Rule 10b5-1 plans or pursuant to accelerated stock repurchase plans, or through privately negotiated transactions, from time to time at management’s discretion in accordance with applicable legal requirements.
+Added: In November 2023, we authorized a $750 million share repurchase program under which repurchases may be made through open market purchases, including pursuant to Rule 10b5-1 plans or pursuant to accelerated stock repurchase plans, or through privately negotiated transactions, from time to time at management’s discretion in accordance with applicable legal requirements.
Common stock repurchases are dependent upon several factors, including our capital position, liquidity, financial strength and credit ratings, general market conditions, the market price of our common stock compared to management’s assessment of the stock’s underlying value and applicable regulatory approvals, as well as other legal and accounting factors.
−Removed: We currently have no plans to declare and pay dividends on our common stock.
−Removed: Any future declaration and payment of dividends or other distributions or returns of capital will be at the discretion of BHF’s Board of Directors and will depend on and be subject to our financial condition, results of operations, cash needs, regulatory and other constraints, capital requirements (including capital requirements of our insurance subsidiaries), contractual restrictions and any other factors that BHF’s Board of Directors deems relevant in making such a determination.
−Removed: Therefore, there can be no assurance that we will pay any dividends or make other distributions or returns of capital on our common stock, or as to the amount of any such dividends, distributions or returns of capital.
+Added: Pursuant to the Merger Agreement, we have agreed that during the period beginning the date of the Merger Agreement through the earlier of the closing of the Merger and the termination of the Merger Agreement, we will not, without the written consent of Aquarian Parent, pay any dividend or other distribution payable in cash, stock or property with respect to our common stock, or subject to certain exceptions, purchase directly or indirectly any of BHF’s or its subsidiaries’ capital stock or other equity or voting interests of BHF or any of its subsidiaries.
+Added: The Merger Agreement permits us to pay periodic cash dividends on our preferred stock not in excess of $412.50 per share on the 6.600% Non-Cumulative Preferred Stock, Series A (the “Series A Preferred Stock”), $421.875 per share on the 6.750% Non-Cumulative Preferred Stock, Series B (the “Series B Preferred Stock”), $335.9375 per share on the 5.375% Non-Cumulative Preferred Stock, Series C (the “Series C Preferred Stock”);
+Added: and $289.0625 per share on the 4.625% Non-Cumulative Preferred Stock, Series D (the “Series D Preferred Stock” and;
+Added: together with the Series A Preferred Stock, the Series B Preferred Stock and the Series C Preferred Stock, the “Preferred Stock”), in each case, per quarter during the period beginning the date of the Merger Agreement through the earlier of the closing of the Merger and the termination of the Merger Agreement, consistent with the per-quarter dividends due under each applicable Certificate of Designations.
+Added: Tab le of Contents
Rating Agencies
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Our financial strength ratings and long-term issuer credit ratings as of the date of this filing were as follows:
−Removed: Best (1) Fitch (2) Moody’s (3) S&P (4)
Financial Strength Ratings:
−Removed: Stable Negative Stable Stable
−Removed: Brighthouse Life Insurance Company A A A3 A+
−Removed: New England Life Insurance Company A A A3 A+
−Removed: Brighthouse Life Insurance Company of NY A NR NR A+
+Added: Brighthouse Life Insurance Company
+Added: New England Life Insurance Company
+Added: Brighthouse Life Insurance Company of NY
Long-term Issuer Credit Ratings:
−Removed: Outlook Negative
−Removed: Negative Stable Stable
Brighthouse Financial, Inc.
−Removed: bbb+ BBB+ Baa3 BBB+
−Removed: Brighthouse Holdings, LLC bbb+ BBB+ Baa3 BBB+
+Added: Brighthouse Holdings, LLC
_______________
+Added: (1) “Watch” indicates that the rating is under review with negative implications.
Best’s financial strength ratings for insurance companies range from “A++ (Superior)” to “S (Suspended).” A.M.
1 unchanged sentence
(2) Fitch’s financial strength ratings for insurance companies range from “AAA (highest rating)” to “C (distressed).” Fitch’s long-term issuer credit ratings range from “AAA (highest rating)” to “D (default).”
+Added: (3) “Watch” indicates that the rating is on review for downgrade.
Moody’s financial strength ratings for insurance companies and long-term issuer credit ratings range from “Aaa (highest quality)” to “C (lowest rated).”
+Added: (4) “Watch” indicates that the rating is on CreditWatch with negative implications.
S&P’s financial strength ratings for insurance companies and long-term issuer credit ratings range from “AAA (extremely strong)” to “SD (selective default)” or “D (default).”
NR = Not rated
−Removed: Rating agencies may continue to review and adjust our ratings.
−Removed: For example, in November 2024, Fitch revised the outlooks on the financial strength rating and the long-term issuer credit rating for BHF and certain of its subsidiaries to negative from stable.
−Removed: In addition, in January 2025, A.M.
−Removed: Best revised the outlook on the long-term issuer credit rating for BHF and certain of its subsidiaries to negative from stable.
−Removed: See “Risk Factors — Risks Related to Our Business — A downgrade or a potential downgrade in our financial strength or credit ratings could result in a loss of business and materially adversely affect our financial condition and results of operations” for a description of the impact of a potential ratings downgrade.
+Added: Rating agencies continue to review and adjust our ratings.
+Added: In July 2025, S&P revised the long-term issuer credit ratings for BHF and BH Holdings to BBB from BBB+.
+Added: In addition, S&P revised the financial strength ratings for certain of our insurance subsidiaries to A from A+, among other revisions.
+Added: Following the announcement that BHF has entered into the Merger Agreement, S&P, Moody’s and AM Best revised their outlook on our financial strength ratings and credit ratings, and Fitch downgraded our financial strength ratings and credit ratings.
+Added: On November 6, 2025, S&P placed BHF, BH Holdings and certain of our insurance subsidiaries on CreditWatch with negative implications.
+Added: On November 7, 2025, Moody’s placed BHF, BH Holdings and certain of our insurance subsidiaries on review for a downgrade and changed the long-term issuer credit rating and financial strength rating outlooks for those entities to rating under review.
+Added: On November 10, 2025, AM Best placed BHF, BH Holdings and certain of our insurance subsidiaries under review with negative implications.
+Added: In addition, on November 10, 2025, Fitch downgraded the long-term issuer credit ratings for BHF and BH Holdings to BBB from BBB+ and the financial strength ratings for certain of our insurance subsidiaries to A- from A.
+Added: See “Risk Factors — Risks Related to Our Business — A downgrade or a potential downgrade in our financial strength or credit ratings could result in a loss of business and materially adversely affect our financial condition and results of operations” for a description of the potential impact of a ratings downgrade.
+Added: Tab le of Contents
Sources and Uses of Liquidity and Capital
1 unchanged sentence
Years Ended December 31,
−Removed: 2024 2023 2022
(In millions)
+Added: Operating activities, net
+Added: Investing activities, net
Changes in policyholder account balances, net
4 unchanged sentences
Investing activities, net
+Added: Changes in policyholder account balances, net
Changes in payables for collateral under securities loaned and other transactions, net
3 unchanged sentences
Financing element on certain derivative instruments and other derivative related transactions, net
−Removed: Other, net 17 19 16
−Removed: Total uses 3,059 4,596 12,009
Net increase (decrease) in cash and cash equivalents
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The primary liquidity concerns with respect to these cash flows are market disruption and the risk of early policyholder withdrawal.
+Added: Tab le of Contents
Primary Sources of Liquidity and Capital
12 unchanged sentences
The institutional spread margin business is comprised of funding agreements issued in connection with the programs described in more detail below.
−Removed: Activity related to these programs are reported in Corporate & Other.
+Added: Activity related to these programs is reported in the Corporate & Other segment.
See “Obligations Under Funding Agreements” in Note 3 of the Notes to the Consolidated Financial Statements for additional information on funding agreements.
11 unchanged sentences
Brighthouse Life Insurance Company has a secured funding agreement program with the Federal Agricultural Mortgage Corporation and its affiliate Farmer Mac Mortgage Securities Corporation (“Farmer Mac”) with a term ending on December 1, 2026, pursuant to which the parties may enter into funding agreements in an aggregate amount of up to $750 million.
+Added: Tab le of Contents
Information regarding funding agreements issued for spread lending purposes is as follows:
−Removed: Aggregate Principal Amount Outstanding Issuances Repayments
−Removed: December 31, Years Ended December 31,
−Removed: 2024 2023 2024 2023 2022 2024 2023 2022
+Added: Aggregate Principal Amount Outstanding
+Added: Years Ended December 31,
(In millions)
1 unchanged sentence
FABCP Program
−Removed: FABN Program 2,550 2,100 1,150 — 550 700 1,350 —
+Added: 2,962 7,510 15,801 8,046 8,218 16,281 6,701
+Added: 2,550 — 1,150 — 550 700 1,350
FHLB Funding Agreements
+Added: 4,300 1,575 2,150 2,350 1,675 2,200 1,900
Farmer Mac Funding Agreements
−Removed: Total $ 10,962 $ 10,592 $ 19,651 $ 10,396 $ 20,107 $ 19,281 $ 9,951 $ 15,733
+Added: 650 250 50 — 400 100 —
Debt Issuances
1 unchanged sentence
Credit and Committed Facilities
−Removed: See Notes 11 and 12 of the Notes to the Consolidated Financial Statements for information regarding our credit and committed facilities.
+Added: See Note 11 of the Notes to the Consolidated Financial Statements for information regarding our credit and committed facilities.
We have no reason to believe that our lending counterparties would be unable to fulfill their respective contractual obligations under these facilities.
6 unchanged sentences
See Note 12 of the Notes to the Consolidated Financial Statements for information relating to authorizations to repurchase BHF common stock, amounts of common stock repurchased pursuant to such authorizations and the amount remaining under such authorizations at December 31, 2025.
−Removed: In 2025, through February 21, 2025, BHF repurchased an additional 603,909 shares of its common stock through open market purchases, pursuant to a Rule 10b5-1 plan, for $33 million.
+Added: See also “Risk Factors — Risks Related to Our Securities — We are not currently permitted to declare and pay dividends on our common stock, and legal restrictions could limit our ability to pay dividends on our capital stock and our ability to repurchase our common stock at the level we wish in the future.”
Preferred Stock Dividends
See Note 12 of the Notes to the Consolidated Financial Statements for information relating to dividends declared and paid on our preferred stock.
+Added: Tab le of Contents
“Dividend Stopper” Provisions in BHF’s Preferred Stock and Junior Subordinated Debentures
19 unchanged sentences
We pledge collateral to, and have collateral pledged to us by, counterparties in connection with our derivatives.
−Removed: At December 31, 2024, we did not pledge any cash collateral to counterparties.
At December 31, 2025, we pledged $34 million of cash collateral to counterparties.
−Removed: At December 31, 2024 and 2023, we were obligated to return cash collateral pledged to us by counterparties of $812 million and $393 million, respectively.
+Added: At December 31, 2024, we did not pledge any cash collateral to counterparties.
+Added: At December 31, 2025 and 2024, we were obligated to return cash collateral pledged to us by counterparties of $1.5 billion and $812 million, respectively.
The timing of the return of the derivatives collateral is uncertain.
3 unchanged sentences
See Note 9 of the Notes to the Consolidated Financial Statements for additional information regarding pledged collateral.
+Added: Tab le of Contents
Securities Lending
2 unchanged sentences
Generally, our securities lending contracts expire within twelve months of issuance.
−Removed: We were liable for cash collateral under our control of $3.2 billion and $3.3 billion at December 31, 2024 and 2023, respectively.
+Added: We were liable for cash collateral under our control of $3.2 billion at both December 31, 2025 and 2024.
We receive non-cash collateral for securities lending from counterparties, which cannot be sold or re-pledged, and which is not recorded on our consolidated balance sheets.
14 unchanged sentences
Constraints on BHF’s liquidity may occur as a result of operational demands or as a result of compliance with regulatory requirements.
−Removed: See “Risk Factors — Risks Related to Our Business — As a holding company, BHF depends on the ability of its subsidiaries to pay dividends,” “Risk Factors — Economic Environment and Capital Markets-Related Risks — Adverse capital and credit market conditions may significantly affect our ability to meet liquidity needs and our access to capital” and “Risk Factors — Regulatory and Legal Risks — Our insurance business is highly regulated, and changes in regulation and in supervisory and enforcement policies or interpretations thereof may materially impact our capitalization or cash flows, reduce our profitability and limit our growth,” as well as Note 12 of the Notes to the Consolidated Financial Statements.
+Added: See “Risk Factors — Risks Related to Our Business — As a holding company, BHF depends on the ability of its subsidiaries to pay dividends,” “Risk Factors — Economic Environment and Capital Markets-Related Risks — Adverse capital and credit market conditions may significantly affect our ability to meet liquidity needs and our access to capital” and “Risk Factors — Regulatory and Legal Risks — Our insurance business is highly regulated, and changes in regulation and in supervisory and enforcement policies or interpretations thereof may materially impact our capitalization or cash flows, reduce our profitability and limit our growth,” as well as Notes 12 and 15 of the Notes to the Consolidated Financial Statements.
Short-term Liquidity and Liquid Assets
−Removed: At December 31, 2024 and 2023, BHF and certain of its non-insurance subsidiaries had short-term liquidity of $912 million and $1.2 billion, respectively.
+Added: At December 31, 2025 and 2024, BHF and certain of its non-insurance subsidiaries had short-term liquidity of $763 million and $912 million, respectively.
Short-term liquidity is comprised of cash and cash equivalents and short-term investments, excluding assets that are pledged or otherwise committed.
Assets pledged or otherwise committed include assets held in trust.
−Removed: At December 31, 2024 and 2023, BHF and certain of its non-insurance subsidiaries had liquid assets of $1.1 billion and $1.3 billion, respectively, of which $1.1 billion and $1.2 billion, respectively, was held by BHF.
+Added: At December 31, 2025 and 2024, BHF and certain of its non-insurance subsidiaries had liquid assets of $911 million and $1.1 billion, respectively, of which $868 million and $1.1 billion, respectively, was held by BHF.
Liquid assets are comprised of cash and cash equivalents, short-term investments and publicly-traded securities, excluding assets that are pledged or otherwise committed.
Assets pledged or otherwise committed include assets held in trust.
−Removed: See Note 18 of the Notes to the Consolidated Financial Statements for a discussion of a capital contribution to BLIC made subsequent to December 31, 2024.
+Added: On February 11, 2025, Brighthouse Life Insurance Company received a $100 million capital contribution from BH Holdings.
+Added: Tab le of Contents
Statutory Capital and Dividends
1 unchanged sentence
See “Business — Regulation — Insurance Regulation” and Note 12 of the Notes to the Consolidated Financial Statements for information regarding our statutory accounting and reserves, as well as the calculation of RBC and the regulatory RBC requirements.
−Removed: At December 31, 2024, our insurance subsidiaries had a combined statutory TAC of approximately $5.4 billion, resulting in a Combined RBC Ratio of approximately 400%.
+Added: At December 31, 2025, our insurance subsidiaries had a preliminary combined statutory TAC of approximately $5.3 billion, resulting in a preliminary Combined RBC Ratio of 456%.
The amount of dividends that our insurance subsidiaries can ultimately pay to BHF through their various parent entities provides an additional margin for risk protection and investment in our businesses.
7 unchanged sentences
Normalized statutory earnings (loss) is used by management to measure our insurance subsidiaries’ ability to pay future distributions and incorporates the effectiveness of our hedging program as well as other factors related to our business.
−Removed: Normalized statutory earnings (loss) is calculated as statutory pre-tax net gain (loss) from operations adjusted for the favorable or unfavorable impacts of (i) net realized capital gains (losses), (ii) the change in total asset requirement at CTE98, net of the change in our variable annuity reserves, which are calculated at CTE70, and (iii) unrealized gains (losses) associated with our variable annuities and Shield hedges, net of reinsurance, and other equity risk management strategies.
+Added: Normalized statutory earnings (loss) is calculated as statutory pre-tax net gain (loss) from operations adjusted for the favorable or unfavorable impacts of (i) net realized capital gains (losses) before capital gains tax (excluding gains (losses) and taxes transferred to the interest maintenance reserve), (ii) the change in total asset requirement at CTE98, net of the change in our variable annuity reserves, which are calculated at CTE70, and (iii) pre-tax unrealized gains (losses) associated with our variable annuities and Shield hedges, net of reinsurance, and other equity risk management strategies.
+Added: See “Glossary” for the definition of CTE.
Normalized statutory earnings (loss) may be further adjusted for certain unanticipated items that impact our results in order to help management and investors better understand, evaluate and forecast those results.
3 unchanged sentences
Statutory net gain (loss) from operations, pre-tax
−Removed: $ (1.2) $ (2.0)
net realized capital gains (losses)
1 unchanged sentence
unrealized gains (losses) on variable annuity & Shield hedges, net of reinsurance, and other equity risk management strategies
−Removed: impact of actuarial items and other insurance adjustments (1)
+Added: impact of actuarial items and other adjustments
Normalized statutory earnings (loss)
−Removed: _______________
−Removed: (1) As a result of variable annuity and Shield Annuity model refinements, actions to hedge Shield Annuity new business on a standalone basis and related actions to develop a separate hedging strategy for the variable annuity and first generation Shield Annuity blocks, CTE70 decreased approximately $700 million and the total asset requirement at CTE98 increased approximately $735 million for the year ended December 31, 2024.
−Removed: The approximately $735 million impact to CTE98 is reflected in ‘impact of actuarial items and other insurance adjustments’ to normalize the effect of these model refinements and actions.
Primary Sources and Uses of Liquidity and Capital
2 unchanged sentences
For example, we have established internal liquidity facilities to provide liquidity within and across our regulated and non-regulated entities to support our businesses.
−Removed: The primary uses of liquidity of BHF include debt-service obligations (including interest expense and debt repayments), preferred stock dividends, capital contributions to subsidiaries, common stock repurchases and payment of general operating expenses.
−Removed: Based on our analysis and comparison of our current and future cash inflows from the dividends we receive from subsidiaries that are permitted to be paid without prior insurance regulatory approval, our investment portfolio and other cash flows and anticipated access to the capital markets, we believe there will be sufficient liquidity and capital to enable BHF to make payments on debt, pay preferred stock dividends, contribute capital to its subsidiaries, repurchase its common stock, pay all general operating expenses and meet its cash needs.
+Added: Tab le of Contents
+Added: The primary uses of liquidity of BHF include debt-service obligations (including interest expense and debt repayments), preferred stock dividends, capital contributions to subsidiaries and payment of general operating expenses.
+Added: Based on our analysis and comparison of our current and future cash inflows from the dividends we receive from subsidiaries that are permitted to be paid without prior insurance regulatory approval, our investment portfolio and other cash flows and anticipated access to the capital markets, we believe there will be sufficient liquidity and capital to enable BHF to make payments on debt, pay preferred stock dividends, contribute capital to its subsidiaries, pay all general operating expenses and meet its cash needs.
+Added: In connection with the Separation, the Company entered into a tax receivables agreement (the “Tax Receivables Agreement”) with MetLife.
+Added: In connection with the Tax Receivables Agreement, the Company has a payable to MetLife of $328 million at both December 31, 2025 and 2024 reported in other liabilities, which would be accelerated upon closing of the Merger.
+Added: See Note 15 of the Notes to the Consolidated Financial Statements.
In addition to the liquidity and capital sources discussed in “— The Company — Primary Sources of Liquidity and Capital” and “— The Company — Primary Uses of Liquidity and Capital,” the following additional information is provided regarding BHF’s primary sources and uses of liquidity and capital:
4 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.